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Auditor suggests changes to Hamilton’s accessible taxi scrip program to avoid misuse

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Hamilton’s auditor is recommending the city make changes over how clients pay for accessible transit services (ATS) amid allegations of misuse.

In a report brought before Hamilton’s audit and finance committee Charles Brown is making three recommendations for the city’s taxi scrips program after transit management revealed some reported ineligible transactions.

“Specifically, it was alleged that the taxi scrip coupons are acquired by third parties and used as in illegitimate exchange transactions and by parties not eligible to be subsidized,” Brown said in a presser.

The program, operational before the city’s amalgamation, offers ATS clients subsidized rides from two local taxi companies using $1, $2 and $5 taxi scrips in $40 booklets at a purchase cost for qualifying riders of $24.

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Those who qualify can purchase up to three books a month over 12 months via telephone or in person at the HSR counter at downtown GO stations, City Hall and municipal service centres.

At issue for the city’s transit management and Brown is the refundability of coupon books that never expire, for those who acquire them but don’t qualify to use them.

“The city will redeem them, but obviously not for $40 because it’s not being used on a trip,” Brown explained.

“So if you have … $400 worth, you get $240 redemption.”

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In hypothetical scenario, Brown suggests there are opportunities for third parties to use the scrips to pay for gas at some stations, resulting in that retailer transfering coupons to a taxi company for cash.

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The taxi outlet would then be able to redeem the scrips, for full value, with the city.

Manager of transit planning and infrastructure Jason Vander Heide said the “potential exposure to fraud or criminal activity” was also outlined for Hamilton Police Service in late
September 2022 for a potential investigation.

However, Hamilton police spokesperson Jackie Penman told Global News the service did look into the matter but are not investigating with the circumstances considered “not to be criminal.”

The office of the city manager also discovered “significant non-compliance” in a sample of June’s coupon redemptions which revealed only about three per cent of scrips were found to be in compliance with contractual requirements.

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After taking a sample of some 1,600 scrips, about 17 per cent of June’s volume used, transit management discovered some of eight key details tended to be missing from scrips — like date of trip, time of trip and/or number of passengers.

Brown is now calling on the city to step up compliance measures with its taxi contracts, improve data management with taxi scrip activity and consider a cost-effective alternative delivery system like tap/swipe cards.

“That … would provide certainly and a much better audit trail and have less fraud potential associated with it than the current process,” said Brown.